Bloomberg News

Ex-JPMorgan Trader Said to Contest Loss Report

July 08, 2014

Former JPMorgan Banker Javier Martin-Artajo

Javier Martin-Artajo, a former JPMorgan banker fighting extradition to the U.S. from Spain over the trading losses, is also challenging the FCA at the finance tribunal. Photographer: Angel Navarrete/Bloomberg

(Corrects story published yesterday to remove erroneous reference to Macris being indicted in fourth and sixth paragraphs.)

Julien Grout, a former JPMorgan Chase & Co. (JPM:US) trader, will challenge the fairness of a U.K. regulator’s report on the $6.2 billion loss blamed on the so-called London Whale, according to a person with knowledge of the matter.

Grout will claim that he can be identified in findings published by the Financial Conduct Authority last year that are supposed to be anonymous, the person said, asking not to be identified because the application isn’t public.

A hearing on his request will take place tomorrow, according to the U.K. financial tribunal’s website. The only information the forum discloses is Grout’s name, the fact that he’s made an application, and the court date.

JPMorgan settled U.S. and U.K. investigations into the losses stemming from Bruno Iksil, the Frenchman who became known as the London Whale for the size of his positions, in September. The bank agreed to pay about $920 million for failing to install adequate controls and misleading regulators and its board, and admitted to violating federal securities laws. While Iksil wasn’t charged after cooperating with the probes, former colleagues Javier Martin-Artajo and Grout were indicted on counts including securities fraud and conspiracy.

Martin-Artajo, a former JPMorgan banker fighting extradition to the U.S. from Spain over the trading losses, is also challenging the FCA at the finance tribunal.

Achilles Macris, another former colleague of Iksil, won a similar challenge against the regulator in April, claiming he should have been allowed to respond to the FCA’s findings before they were published with the September settlement. He has not been indicted in any jurisdiction.

Martin-Artajo was indicted in Manhattan federal court in September for allegedly helping to hide the losses caused by Iksil. The SEC said in a lawsuit that Martin-Artajo and Julien Grout, who worked for him, engaged in a scheme to enhance the portfolio’s apparent performance and thereby curry favor with supervisors.

The Financial Times reported Grout’s challenge yesterday.

To contact the reporter on this story: Ben Moshinsky in London at bmoshinsky@bloomberg.net

To contact the editors responsible for this story: Heather Smith at hsmith26@bloomberg.net


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